Executive Summary
Manhattan’s commercial real estate market showed robust activity in the week ending February 10, 2026, with $88 million in property sales and major lease commitments from financial services tenants totaling over 400,000 square feet. This would signal NYC Commerical Real Estate resurgence?
The Federal Reserve maintained its benchmark rate at 3.50%–3.75% following three consecutive cuts in 2025, with Chair Powell signaling that current policy supports progress on the Fed’s dual mandate as inflation moderates to 2.7%.
Meanwhile, implementation of the City of Yes for Housing Opportunity zoning amendments continues to reshape development dynamics, with nearly 15 million square feet of office space identified for residential conversion and rent increase caps now affecting virtually all multifamily housing across New York City.
Key Headlines
- Federal Reserve holds rates at 3.50%–3.75%; 10-Year Treasury at 4.22% as inflation moderates to 2.7%
- JPMorgan Chase expands 139,000 SF at Five Manhattan West as financial services firms commit over 400,000 SF in new Midtown leases
- Three property sales total $88M, including $31.8M SoHo mixed-use and $30M Hell’s Kitchen development site
- One High Line secures $525M refinancing; Tishman Speyer emerges as frontrunner to reacquire the Chrysler Building
- Manhattan office availability hits a four-year low of 15.8%, with trophy leasing 36% above pre-COVID levels
- City of Yes advances with 15M+ SF identified for office-to-residential conversions; rent caps now nearly universal
- Luxury residential market posts strongest week in over a year for $10M+ transactions
Deals & Transactions
Sales & Acquisitions
Three notable property sales closed during the week ending February 6, totaling $88 million in transaction volume. Joel Wertzberger acquired 254 West 35th Street in the Garment District for $26.2 million, equating to approximately $283 per square foot.
A commercial land parcel at 539 West 54th Street in Hell’s Kitchen traded for $30 million, underscoring continued investor appetite for near-Midtown development sites.
The mixed-use property at 65–67 Greene Street in SoHo sold for $31.8 million, benefiting from strong retail fundamentals and potential residential conversion upside under updated zoning rules.
Related: Deals & Transactions, NYC Investment Sales
Office Leasing Activity
Financial services firms continued expansion and consolidation across Midtown Manhattan. JPMorgan Chase executed a 139,000 SF expansion at Five Manhattan West, reinforcing demand for premium Hudson Yards office space.
Bank of Montreal leased 82,000 SF at 151 West 42nd Street, while StoneX Group expanded to 95,000 SF at 230 Park Avenue. Cigna renewed its footprint at 2 Grand Central Tower.
On the retail side, Burlington Stores expanded to 206,000 SF at 1400 Broadway, signaling sustained demand for large-format retail in Times Square.
Related: NYC Office Market, Midtown Manhattan Leasing
Capital Markets & Financing
One High Line secured a $525 million refinancing, signaling lender confidence in institutional-quality multifamily assets. Extell Development completed an air-rights acquisition from the Metropolitan Club, while Empire State Realty Trust listed 250 West 57th Street for sale.
Tishman Speyer has emerged as the frontrunner to reacquire the Chrysler Building, and Manhattan’s luxury residential market posted its strongest $10M-plus week in over a year.
Related: Financing Trends, CMBS Market
Interest Rates & Financing Trends
The Federal Reserve held rates steady at 3.50%–3.75% following three 25-basis-point cuts in 2025. The effective federal funds rate stands at 3.64%, with the 10-Year Treasury trading near 4.22%.
Chair Powell emphasized a data-dependent stance, with inflation moderating to 2.7% year-over-year. While two FOMC members dissented in favor of another cut, near-term rate reductions appear unlikely.
For CRE underwriting, the environment provides relative stability, though borrowing costs remain elevated compared to the 2020–2021 cycle.
Related: Interest Rates, Federal Reserve Policy, Financing Trends
Regulatory & Policy Updates
The City of Yes for Housing Opportunity amendments continue to reshape New York City’s development framework. Buildings constructed before December 31, 1990 may now convert from non-residential to residential use, with over 15 million SF identified as conversion candidates—potentially yielding 17,400 apartments.
New R11 and R12 zoning districts allow FAR up to 15 and 18, while the Universal Affordability Preference provides 20%+ FAR bonuses for income-restricted housing. Parking mandates have been eliminated in the Inner Transit Zone, and ADUs and basement apartments are now legalized citywide.
Nearly 100% of NYC multifamily housing is now subject to rent increase caps, materially altering investor return profiles.
Related: NYC Zoning & Regulation, City of Yes, Office-to-Residential Conversions
Asset Class Updates
Office
Manhattan office leasing reached 30.2 million SF through Q3 2025, up 9% year-over-year, while availability declined to 15.8%, a four-year low. Trophy assets continue to outperform, with leasing 36% above pre-COVID levels.
This week’s activity reinforces the flight-to-quality trend, while Class B and C assets face growing pressure and increased conversion consideration.
Multifamily
Multifamily markets in Manhattan and Brooklyn are positioned for rent highs amid constrained supply. Development has slowed sharply, pushing focus toward adaptive reuse and office-to-residential conversions.
The $525M One High Line refinancing highlights lender confidence in best-in-class assets despite regulatory and cost headwinds.
Retail
Retail leasing exceeded 3.0 million SF through Q3 2025, with flagship corridors outperforming. Experiential retail continues to command premiums, while office-dependent corridors remain challenged. Residential conversions may ultimately support neighborhood-scale retail demand.
Industrial
Industrial assets remain a relative safe haven, supported by e-commerce and last-mile logistics demand. Outer-borough locations are attracting heightened interest, though land constraints and construction costs limit new supply.
Looking Ahead
Investors should monitor upcoming CPI and employment data for signals on Fed policy. The outcome of Tishman Speyer’s Chrysler Building bid will serve as a valuation bellwether, while early City of Yes conversion applications will clarify feasibility across the 15M SF pipeline. February leasing velocity will indicate whether Q1 2026 can sustain 2025’s momentum.
Sources: The Real Deal, FRED, Federal Reserve, Cushman & Wakefield, Newmark, FCMRE, JPMorgan, Greenberg Traurig
